1 January Grigory paid $5,000 into the business 2 January Bought a motor van for $600 on credit 3 January Bought goods for $1,300 on credit 4 January Received a loan from Sergei $1,000 repayable within twelve months 10 January Paid expenses on the motor van of $200 13 January Sold goods for $300 on credit 20 January Sold goods for $500 by cash 24 January Accrued storage expenses $150 27 January Repaid Sergei part of his loan $350 31 January Closing inventory was $800 Required Prepare: (iv) a statement of profit or loss (income statement) for the year to date; (v) a statement of financial position (balance sheet).
The Effect Of Prepaid Taxes On Assets And Liabilities
Many businesses estimate tax liability and make payments throughout the year (often quarterly). When a company overestimates its tax liability, this results in the business paying a prepaid tax. Prepaid taxes will be reversed within one year but can result in prepaid assets and liabilities.
Final Accounts
Financial accounting is one of the branches of accounting in which the transactions arising in the business over a particular period are recorded.
Ledger Posting
A ledger is an account that provides information on all the transactions that have taken place during a particular period. It is also known as General Ledger. For example, your bank account statement is a general ledger that gives information about the amount paid/debited or received/ credited from your bank account over some time.
Trial Balance and Final Accounts
In accounting we start with recording transaction with journal entries then we make separate ledger account for each type of transaction. It is very necessary to check and verify that the transaction transferred to ledgers from the journal are accurately recorded or not. Trial balance helps in this. Trial balance helps to check the accuracy of posting the ledger accounts. It helps the accountant to assist in preparing final accounts. It also helps the accountant to check whether all the debits and credits of items are recorded and posted accurately. Like in a balance sheet debit and credit side should be equal, similarly in trial balance debit balance and credit balance should tally.
Adjustment Entries
At the end of every accounting period Adjustment Entries are made in order to adjust the accounts precisely replicate the expenses and revenue of the current period. It is also known as end of period adjustment. It can also be referred as financial reporting that corrects the errors made previously in the accounting period. The basic characteristics of every adjustment entry is that it affects at least one real account and one nominal account.
1 January Grigory paid $5,000 into the business
2 January Bought a motor van for $600 on credit
3 January Bought goods for $1,300 on credit
4 January Received a loan from Sergei $1,000 repayable within twelve months
10 January Paid expenses on the motor van of $200
13 January Sold goods for $300 on credit
20 January Sold goods for $500 by cash
24 January Accrued storage expenses $150
27 January Repaid Sergei part of his loan $350
31 January Closing inventory was $800
Required
Prepare:
(iv) a statement of profit or loss (income statement) for the year to date;
(v) a
BUT WE HAVE COMPLETED ONLY 9 CHAPTERS IN PRINCIPLES OF ACCOUNTING BY Marian Powers, Susan V Crosson, Belverd E Needles, so assuming this information we have to create general journal
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